Austria’s VAT policy is based on the "destination principle" of the European Union VAT system. This means that VAT is payable to the country's government where the product or services are consumed, regardless of where you're supplying them from. So, if you have clients in Austria, you have to comply with Austrian VAT rules.
The standard VAT rate in Austria is 20%, with reduced rates of 13%, 10%, and 0% applying to a few products. This guide includes everything you, as a freelancer, need to know about VAT in Austria in a nutshell. Let's get started!
If you’re wondering whether you are eligible or required to register for VAT in Austria; we might have the answer you’re looking for:
VAT Exempted Goods and Services
According to the Austrian VAT law, the following are exempt from VAT:
Cross-Border Services as a Freelancer
There is no specific threshold for VAT registration for expats in Austria; instead, the country follows a reverse-charge mechanism to tax foreign individuals and companies.
If you’re still confused, Xolo can help you register as a freelancer in Austria and handle all the necessary paperwork on your behalf. With Xolo Go, you can use a slice of our company as a legal framework to invoice your clients whether they're in Austria or beyond.
If your annual sales turnover exceeds the VAT threshold limit, you must apply for a VAT identification number, either online or offline. Additionally, you are required to have an EU VAT Number if you plan on carrying out any form of intra-EU transaction.
You can also register using the Mini One-Stop Shop, an EU-wide tax system that allows you to consolidate all of your EU VAT in one single tax return. This is where the EU VAT number comes in. The scheme is optional but convenient and especially useful if you have customers in multiple countries within the EU, including Austria. MOSS allows you to avoid registering in each Member State of consumption. To learn more, click here.
To receive your VAT identification number offline, you are required to visit the Graz-Stadt tax office in person with the following completed forms:
Your application has to have clear reasons and all the details related to the taxable transactions, your orders, and your customers and suppliers.
Alternatively, you can hire an accountant (or agency) to handle your VAT returns and dealings with the Austrian Tax Administration. Xolo provides services like Xolo Go and Xolo Leap, which help with precisely this and any other VAT concerns you may have.
Now that you know how to register for VAT, you might be interested in understanding how much VAT you’re liable to pay! The Austrian tax administration levies four different VAT rates, and freelancers must charge the amount that applies to their products and services:
Registering for VAT is only part of the process. In order to fully comply with VAT registration laws, you must also make sure to file VAT returns.
Does that sound excessive? At Xolo, we automatically generate, send, and store all your invoices digitally, so you won’t have to worry about missing due dates or misplacing documents.
The tax registration process can be tricky at times, but we hope this guide has helped clear your doubts! If you’re still overwhelmed by the different schemes and numbers, and paperwork, Xolo offers a range of solutions that handle all the hassle while you focus on your core competencies.
With Xolo Go, you can easily freelance and invoice your clients, even without a registered company or LLC.
Simply put, we do the hefty work for you so that you can enjoy the freedom of freelancing. So connect with us immediately, and we’ll help you get your one-person business up and running in Austria in no time!